Town square project: ‘a tone of insider dealing’

On Tuesday, July 22, the Riverhead Town Board will hold a public hearing at 6 p.m. on whether J Petrocelli is “qualified and eligible” to purchase land from the town and develop it as a hotel/condominium as part of the town square. Because of the way the board has set this up, it is the first and probably the only opportunity for the people of Riverhead to be heard about whether they want a five story 76-room hotel plus 12 condominiums built between the Suffolk theater and the Peconic River.

The proposed hotel will dominate the east side of the visionary square, narrowing the vista from Main Street to the river and the proposed amphitheater. It requires sale of publicly owned land now occupied by the Craft’d tavern and by the East End Arts Council to Petrocelli.

Twelve parking spaces will be provided under the building for the condominium owners. Hotel patrons will occupy up to 76 leased spaces in the planned parking garage to the north of the theater.

As debatable as the hotel is, the way it came about is at least as disturbing. A March 22, 2021 press release, “Riverhead Seeks Public Participation in Town Square Design Process”, announced, “The buildings located at 117 and 121 East Main Street will be demolished, while 127 East Main Street would remain in place, although it will be extensively renovated.” However “at or near the time of [its]completion of the demolition of the structures located at 117 and 121 [October 18, 2021], Petrocelli Development…expressed interest and desire to develop and present a plan for the public space, reuse and redevelopment of 127.”

After meetings with the Community Development Agency and the Town Board, “in early February of 2022, Petrocelli Development presented a more formal plan to the Town Board and Community Development Agency.” None of these meetings were reported in the media and no request for proposals was issued to seek alternative concepts and budgets. Instead on April 14, 2022, Petrocelli made a warmly received presentation to a board work session. Five days later, the resolution quoted above was presented to the Town Board and unanimously adopted to designate Petrocelli as the town square master developer. At that point he was proposing a four-story hotel and additional buildings to the west abutting the Science Center and a four-story condominium on the waterfront.

After three years of more behind-the-scenes discussions, the board adopted on July 1, 2025, a resolution to hold the qualified and eligible hearing only three weeks later in the middle of summer. The Master Developer Agreement with Petrocelli is 36 pages plus 94 pages of detailed planning documents and agreements covering the hotel construction as well as the Town Square Gathering/Upper Deck, Town Square Playground/Lower Deck, and the East End Arts/Ampitheater Projects. The hotel had grown to five stories with condominiums but the two additional buildings to the west are not mentioned. The Master Developer Agreement.pdf can be found on the web page of Town Clerk Jim Wooten. Photos and successive architect renderings can be seen at http://tinyurl.com/RHTOWNSQUARE

Mr. Petrocelli and Ms. Thomas can be commended for a substantial professional presentation. Legally it was not required to invite other proposals although that would have been a more transparent process. Unfortunately they and the Town Board made no serious effort to find out whether or not the people of Riverhead actually wanted to sell town-owned land to use part of the square for a third Petrocelli hotel. Mr. Petrocelli has contributed substantially to the reconstruction of downtown Riverhead, most notably the aquarium and his two adjacent hotels. His projects have received tax benefits, although presumably they are quite profitable. The Master Developer Agreement stipulates he will apply to the IDA for “a PILOT payment, escalation and term acceptable to Master Developer in its sole but reasonable, discretion” with the threat that failure to get the PILOT agreement, “will have a material adverse impact on the economics of the transactions.”

There is a tone of insider dealing in the process. The primary actors have such familiarity and respect for each other that they made unwarranted assumptions without adequate public consultation. There is no trace of discussion of a hotel in the Pattern Book published January 12, 2021. In fact, the second largest threat to downtown Riverhead was said to be “new buildings are too massive”. Almost twice as many people said “no more housing is needed” than favored “more for-sale town houses and condominiums”. The only reference to hotels in the new Comprehensive Plan was to promote the discredited agrotourism resort. Mentions of the town square were largely to the opening of space and vistas between Main Street and the river and included nothing about a hotel as part of the square.

An aspect of the Petrocelli closeness to Riverhead powers-that-be is that for many years the family has been a substantial donor to the Republican Party and its candidates. In the 2023 election cycle, that amounted to $3,000 according to campaign finance records. Such contributions are perfectly legal but it is reasonable to wonder whether large donations are an expression of gratitude or to gain influence.

The first reaction by the incumbent supervisor and the Riverhead Town Board when their fait accompli grand projects are challenged is to demean critics for negativism and to steam roll ahead. Riverhead citizens have overpowered this attitude twice in the past few years over the Ghermezians’ cargo airport plans for EPCAL and an agrotourism resort on Sound Avenue. People overwhelmed the Town Board with calls, e-mails and petitions, and by turning out in decisive numbers, when their direct interests were threatened. Will they be as motivated by social, economic and aesthetic preferences for the long-term future of a unique public space?

John McAuliff is a resident of Riverhead.